Amid fossil fuel shift in U.S., hope emerges for India and Japan tie-up on solar
But at the International Solar Festival held at the Osaka Expo earlier this month, the focus wasn't on competition but rather how India and Japan can partner to grow solar capacity together.
The gathering, the second of its kind, was organized by the International Solar Alliance (ISA) and brought together business leaders, government officials and other representatives from Japan, India and ISA member nations. The goal was to tell the story of solar and its potential as a driver of economic growth to visitors from around the world.
'We wanted to have the International Solar Festival in Osaka because one of the key challenges is on getting the private sector to look at new frontier solar technologies, which is linked to the question of how Japan and India can collaborate meaningfully,' said Ashish Khanna, the director-general of the ISA.
The ISA, founded in 2015 at COP21 in Paris and based in India, has more than 100 member countries. Of those, India and Japan are two of the largest economies and are widely seen as leaders in global solar and solar-linked technologies.
In addition to promoting tech to the private sector, the alliance also seeks to address another challenge — the lack of progress on expanding solar generation and production in developing countries, despite massive potential. Case in point, the most recent analysis from the International Renewable Energy Agency (IRENA) found that Asia, Europe and North America accounted for 90% of renewable capacity growth in 2024.
'Bridging the divide and closing the investment gap between countries and regions is critical,' said Francesco La Camera, IRENA's director-general, in an emailed statement.
Expanding partnerships
The ISF in Osaka was just the latest in a series of energy- and climate-related discussions between Japan and India. In 2022, the two countries launched a Clean Energy Partnership, with the goal of expanding cooperation on clean energy and energy security.
India also joined the Japan-led Asia Energy Transition Initiative (AETI) in 2023. More recently, talks are ongoing about India becoming the next country eligible to receive funds under Japan's joint crediting mechanism (JCM), one of the largest state-led carbon credit and offset programs in the world.
'The JCM is expected to generate employment opportunities in both nations by fostering investments in low-carbon technologies,' said Shamkant Mirashi, an India-based sustainability consultant. 'By subsidizing these technologies, Japan can help equalize the cost of clean energy with conventional polluting sources.'
The International Solar Alliance hosted a festival at the Osaka Expo, with collaboration in the key renewable energy source being the order of the day. |
Nithin Coca
Then, in 2024, the Japan Bank for International Cooperation (JBIC) provided funds to support Osaka Gas' joint investment in renewable energy projects with India's CleanMax.
Despite this, there's still much more to be done, says Khanna, as overall bilateral investment and trade in solar have been limited. That, he hopes, will soon change.
'All partnerships take time,' Khanna said. 'We want to see the R&D and manufacturing ecosystem of Japan marrying with the entrepreneurial talent and market of India, a harmonization of alignment. How this translates into concrete business opportunities is something that we would like to facilitate more.'
One challenge is that most major Japanese companies and financial institutions have yet to make large investments into solar technologies in India, which Khanna says is disappointing, as solar provides a safe, reliable investment opportunity.
'Japan has not exercised enough the financial muscle of its pension funds and institutional investors,' said Khanna. 'The time is now ... to create an ecosystem by which more concrete investment decisions are made.'
Part of that reluctance could be the fact that major players in Japan and the government itself are not exactly all-in on solar energy.
One criticism of Japan's approach, via entities such as AETI but also the Asia Zero Emissions Community (AZEC) has been a focus on pushing alternative Japanese technologies such as ammonia and biomass co-firing, hydrogen and carbon capture and storage. Critics say these alternatives are either not viable, short-term solutions or would have limited impact in reducing emissions. But Khanna did not necessarily see these efforts as distracting from solar.
'I think the answer for that is not either/or, but and,' said Khanna. 'Green hydrogen and ammonia have huge potential if the economics can be sorted out, and India can be a source of green hydrogen for Japan.'
The elephants in the room
Two notable countries were absent at the ISF — the United States and China. Despite their lack of engagement in the solar alliance, both countries, in their respective ways, cast a long shadow on the potential for Japan-India solar collaboration.
While the U.S. has the second-highest solar capacity in the world and, under the Inflation Reduction Act passed during the administration of U.S. President Joe Biden, has made strides in solar and cleantech manufacturing, the world's largest economy is seeing dramatic cutbacks in global climate support this year.
Employees carry solar panels at a plant in Aksu in China's Xinjiang Uyghur Autonomous Region in 2012. |
Reuters
The main driver is the administration of U.S. President Donald Trump, whose recent budget reconciliation law passed by Congress would reduce solar tax credits, part of a sudden shift away from support for renewable energy projects.
'It guts clean energy tax credits, kills American jobs and ships them overseas, raises electricity bills for families and small businesses, and weakens our energy independence,' said Andrew Reagan, president of the nonprofit Clean Energy for America, in a press release.
Efforts set up under the Biden administration, like a partnership with Japan focused on expanding technology and supply chains for floating offshore wind, look unlikely to continue.
Instead, amid trade tensions between the two countries, the U.S. has been pushing Japan to buy more of its liquefied natural gas. In fact, new trade tariffs also could limit the export of solar components and panels to the U.S., while the Trump administration prioritizes the domestic expansion of planet-warming fossil fuels such as coal and natural gas.
China, meanwhile, has been praised for its rapid domestic expansion of solar, adding more capacity than the rest of the world combined in 2024. But the industry has numerous ethical concerns, including well-documented links to forced labor and human rights violations in the Uyghur homelands in the far-western region of Xinjiang, where many solar components are produced.
'There is a significant risk that that solar panels are being built with Uyghur forced labor, potentially across every stage: from quartz mining and polysilicon refinement to module construction and the development of the plant itself,' said Elfidar Iltebir, president of the nonprofit Uyghur American Association.
A solar power plant in Solapur, India, in March. In 2024, the country overtook Japan to become the country with the third-largest solar capacity in the world. |
Reuters
Chinese companies, backed by state subsidies and access to cheap energy and labor, have been able to undercut solar manufacturing in Europe and Japan. Even India's attempts to expand domestic production have run into issues, and the country remains reliant on Chinese components.
Exploring new technologies
With those issues plaguing the industry in the world's top two economies, tie-ups between countries such as India and Japan become all the more important.
For Khanna, one path forward might be developing alternatives to photovoltaics, the most common solar technology used today.
'If the industry is disrupted, that can itself become a source of diversification,' said Khanna. 'Perovskite, for example, doesn't need silica or ingots, and solid state batteries may not need lithium. The current supply chain can become a new supply chain if these technologies can be commercialized, and there is clearly a role for India, Japan and other countries to collaborate.'
A model already exists, says Khanna. One of India's leading foreign collaborators is Shizuoka Prefecture-based Suzuki, which partnered with India's Maruti to build the country's largest automaker, and have even released an electric car together.
'What will be the Suzuki for solar in India,' asked Khanna. 'Suzuki transformed the automobile sector, by taking a bet. Who will take that bet, that private sector leadership, for solar?'
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